L&G enters European ETF market

L&G enters European ETF market

Legal and General Investment Management (LGIM) has plunged into the European exchange traded fund market with the acquisition of ETF Securities' fund platform.

The acquisition of Canvass brings $2.7bn (£2bn) of assets under management to LGIM.

Canvass manages investments for a number of ETFs on the platform, and effectively offers a white label service to other firms wishing to launch their own exchange traded fund service.

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In total, it has a range of 17 products, across equity, fixed income and commodities. 

An ETF is a marketable security that tracks an index, a commodity, bonds, or a basket of assets like an index fund. Unlike mutual funds, an ETF trades like a common stock on a stock exchange, and experiences price changes throughout the day as they are bought and sold.

Significantly cheaper than traditional fund management, ETFs are an incredibly fast-growing part of the investment market. Global ETF assets have risen from $800bn (£607bn) 10 years ago to $4.2tn (£3.2tn) at the end of August, according to industry data provider ETFGI.

Mark Zinkula, LGIM  chief executive, said: “As a leader in product innovation, we are constantly exploring ways to deliver new investment solutions for our clients.

"The ETF market is one of the fastest growing segments in asset management. A number of long-term macro trends, including the increasing use of passive vehicles and the drive to digitalisation, will lead to a growing demand for ETF products.”

ETF Securities last week sold its ETF business to Wisdom Tree.